Coalition's new NBN timetable 'very, very tight'

Lucy Battersby

NBN Co is unlikely to switch construction to a fibre-to-the-node model until late 2014 due to the complexity of changing the network architecture, the company’s executive chairman told a Senate estimates committee.

Getting every premises connected to speeds of at least 25 megabits per second [Mbps] by the end of 2016, as promised by the Coalition during the last election, was a "very, very tight timetable", Ziggy Switkowski said on Tuesday night. Meanwhile, NBN Co would keep installing fibre all the way into households throughout 2014.

"One key advantage of fibre to the node is that the network can be built and completed more quickly and less intrusively and less expensively than an all fibre network," Dr Switkowski said.

"So yes, fibre-to-the-node should see us provide [broadband] access to Australians at the 25 Mbps level faster than virtually any other fixed network option. The transition ... to a fibre-to-the-node architecture will take most of next calendar year to execute. So we will be fibre-to-the-premises from now well into next year, and then you could say the starting date for fibre-to-the-node at scale will be quite late next year. So to have until to the end of 2016 is a very, very tight timetable."

Mr Switkowski added that changes to NBN Co's construction maps since the change of government did not mean households previously slated for a fibre to the home connection would no longer receive one. The government-owned company recently changed its maps by removing premises where construction was due to start within one or three years, and now only shows premises where services were available or construction was physically underway

"That is just a way of presenting data. Nothing changed. The only thing that changed was the way in which we were reporting the roll out," Dr Switkowski said.

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Changing the maps also did not "create expectations that NBN Co struggled to meet".

"Rather than making promises to pass as many houses as possible with an operational model that has clearly struggled, my priority is to fix the model itself," Dr Switkowski said.

Under questioning from Labor Senator Kate Lundy, Dr Switkowski defended recent arrival of several former Telstra executives at NBN Co, including himself, saying Telstra was one of the few organisations in Australia that "produce the range of skills that building this network requires".

There had been too few ex-Telstra executives working under former NBN Co chief executive Mike Quigley, Dr Switkowski said later in the hearing, and too few people with knowledge of Australia’s construction industry.

Senator Lundy and Greens Senator Scott Ludlam also questioned NBN Co about the of state Telstra’s copper network and whether this infrastructure was fit for use in a fibre-to-the-node network. The node-based network uses up to several hundred metres of existing copper wires running from each premises up to the node, rather than replacing the entire copper wire with fibre optic cable.

Dr Switkowski said there were already millions of people using Telstra’s copper network for broadband and the fault rate on its network this year was "maybe higher than it was when I was at Telstra, but not materially". He added that many faults in 2013 were caused by wetter than usual weather and if individual copper wires were unusable they would be replaced with fibre.

Dr Switkowski refused to say what potential copper network remediation costs would be because this was "commercially sensitive" information that would be part of NBN Co’s renegotiations of its deal with Telstra.

NBN Co's new chief operating officer Greg Adcock confirmed NBN Co would test parts of Telstra's copper underground network before it made any definite moves to a fibre to the node network.

"The current thinking is that there would be testing done. Whether it informs the strategic review or whether the strategic review makes some assumptions to be then tested, I think that is the way we would frame it at this point," Mr Adcock said.

"I would be very careful about making decisions today that have associated with them enormous costs and enormous execution challenges because we think that in ten years time there are going to be particular applications that will require just that form of delivery," he said.